Gen Xers across the country face a harsh financial reality as they approach retirement age. Many find themselves unprepared, with limited savings and mounting debt. Theresa Nickolich, a Phoenix elementary school principal and single mom, recently sold her condo to settle most of her debt.
At 56, with twin daughters in college and $13,000 in student loans, she now rents a home with her 88-year-old mother for over $4,000 a month. “I’ve never been able to put any money away because I’ve had to live paycheck to paycheck,” Nickolich said, despite earning a solid income in the low six figures. Nickolich is considering early retirement, but her options are limited by the Arizona State Retirement System, a pension plan that constitutes her retirement savings, along with Social Security.
If she takes early retirement, she would receive $2,200 a month, but she acknowledges that “the math is not matching.”
Tyler Bond, research director at the National Institute on Retirement Security, co-authored a report titled “The Forgotten Generation,” detailing the grim retirement outlook for Gen Xers.
Gen Xer retirement struggles persist
He found that the typical Gen X worker has only $10,000 in retirement savings, while the median household amount is $40,000.
The decline of pensions and the rise of 401(K) plans during their entry into the workforce contributed to this situation. About half of America’s 64 million Gen Xers participate in an employer-sponsored plan. Dennis Hoffman, a professor of economics at Arizona State University, notes that Gen Xers have faced more economic shocks than baby boomers, from the dot-com bubble to the Great Recession and the pandemic, repeatedly undercutting their financial stability.
Frank Infurna, a psychologist at ASU, said he’s worried about middle-aged Americans, including Gen Xers. His research shows “Gen Xers are reporting higher levels of depressive symptoms, loneliness, poor physical health, and poor episodic memory or cognitive functioning,” attributed mainly to financial stress. Nickolich remains one of the luckier Gen Xers with family support, though it might mean moving to Italy to live with her sister, who retired there because she couldn’t afford to retire in the U.S.
The financial reality for many approaching retirement is far from the dreams they once harbored.
For Gen Xers like Nickolich, the challenge remains finding stability and security in the future.
